A push strategy is used when there is short distribution channels while a pull strategy is used when there is long distribution channels

 

For example, Starbucks adopt push strategy by promoting new drinks to customers when they are ordering. Starbucks also adopt pull strategy by often promoting one-for-one drink deals to entice customer. 

1. Implementing a push strategy is difficult when channel members, not producers, wield power. It can also be ineffective when distribution channels are lengthy, in which case a pull strategy might be better.

Eg. Starbucks uses push strategy as their distribution channels are not lengthy. 

2. Increasing consumer awareness and generating demand can be difficult in emerging markets with few forms of mass media. Billboards and radio may be needed when consumers have little or no access to the Internet or to cable or satellite TV.

Eg. Starbucks uses pull strategy by advertising online since there are easy access to the internet these days.

3. Finally, a pull strategy may be best when buyers display brand loyalty because they know the product they want. A push strategy can be more appropriate for inexpensive consumer goods and when buyers are not brand loyal because they may seek the least expensive brand that a retailer carries.

Eg. Starbucks uses pull strategy because they have brand loyalty. Starbucks offer and standardised menu throughout its outlets. Thus, tourist may come back to Starbucks due to the brand loyalty. 

§  Standardised Menu (Consistent image/message.) Caffe Latte, Cappuccino, Caffe Americano, Espresso, Caffe Mocha, Caffe Mochiato, Assorted Teas, Hot/Cold Brew Coffee, Frappuccino Blends. 

§  Localised Menu (Respond to local tastes.)

·       Japan – Sakura Blossom Creamy Latte

·       U.K. – Butterscotch Brulee Latte

·       Middle East – Labneh Sandwich

·       South Korea – Avocado Yoghurt Blend

·       Brazil – Brigadeiro Frappuccino

·       Seattle, U.S – Iced Sparkling Espresso with Mint

·       Exclusively Designed Local/Tourist Special Cold Cups & Mugs 

o   Promotion

§  Brand and Product Names (Beverages and Food based on familiar local ingredients that are palatable to people of each country, such as )

§  Extend/Adapt Product

o   Place

§  Determining Retail Locations (Malls where youngsters hang out at to study/have tea break and touristy areas)

o   Price

§  Product Differentiation - Ethically sourced coffee beans from environmentally friendly coffee farms that justify higher prices.

§  Focus on youngsters. (niche consumer group)

§  Dual pricing - Different Prices across different countries due to differing income levels, general price levels and degree of competition.

• This is often the simplest and most profitable strategy because the firm does not adapt its product or marketing.

• This method is well-suited to companies that use a global strategy to sell upscale luxury items with global brand names.

• Low Cost from Economies of Scale for both Production of Goods and Advertisement.

• Starbucks offers a rewards program, which includes free drinks, birthday rewards and more. The rewards program keeps people coming back and prompts them to spread a positive vibe about the brand.

2) Extend product; adopt communication
The second option is for a firm to sell the same product into new target markets but alters its promotion.

• The promotional message needs adaptation because the product appeals to a different buyer, satisfies a different need, or serves a different function, depending on the country’s level of economic development or culture/language.

• This strategy helps contain costs because the product does not undergo any alterations.

• It may also work well in a market with a low level of economic development. Door-to-door personal selling and regional product shows or fairs may be better options when TV and radio coverage are limited and the Internet is years behind.
- Starbucks offers 1-for-1 deals in Singapore to attract the locals because they are usually tempted when there is a promotion.

3) Adopt product; extend communication
The third option is for a firm to adapt its product to target markets yet retain its home-market promotional strategy.
• A company may unintentionally adapt its product when a target market requires that local resources produce goods locally. This can cause a finished product to turn out differently than one made in the home market.
• Other requirements include product safety codes that differ from those in the home market, or changes needed to suit the local infrastructure.
• This strategy can be very costly, especially if a company must invest in production facilities in target markets to remain close to shifting buyer preferences. But it can be successful if a firm sells a differentiated product and can charge a higher price to compensate for higher production costs.
• Starbucks offers exclusive holiday drinks in red cups for Christmas special, such as Toasted White Chocolate Mocha or Gingerbread Latte.

4) Adopt product; adopt communication
The fourth option is for a firm to adapt its product and its promotions to suit the target market.

5) Product invention
The fifth option is for a firm to invent an entirely new product for a target market.